NEW YORK and ORVILLE, Ohio — Pet food and treat sales were up and down for The J.M. Smucker Company in the third quarter of its fiscal 2020, amid the company's across-the-board net sales declines.

Smucker’s pet segment net sales declined 5% compared to year-ago revenue, due to premium and private label dog food struggles.

“Softness in premium dog food continued as expected with a 13% decline for the Natural Balance brand and a 4% decline for the Nutrish brand. Sales of private label products continued to be a headwind in the quarter, impacting net sales by 2%,” said Mark Belgya, vice chair and chief financial officer of Smucker’s.

In the company’s recent financial reporting, it indicated a loss in earnings of approximately $52 million due to Natural Balance’s downswing in the pet specialty channel.

“Going forward, we anticipate ongoing work to optimize the mix of grain-in and grain-free offerings, a refreshed parking campaign and sharper price points will improve trends for the brand next fiscal year,” Belgya said.

Private label, although only a small portion of the company’s pet segment sales, was described as a “near-term headwind” for the company, “accounting for $50 million in reduced sales this year, $30 million of which were planned exits from certain low-margin businesses,” said Mark Smucker, president and CEO, during Smucker’s presentation at CAGNY 2020.

Sales of Rachael Ray Nutrish pet food declined overall due to distribution and retail discrepancies in late 2019 and “competitive activity in the premium dog food category,” said Mark Smucker, president and CEO of The J.M. Smucker Company.

Declines in dog food were offset by growth in cat food, specifically the Meow Mix brand. In fact, Belgya pointed out that Smucker’s total cat portfolio, as well as its Meow Mix brand, both achieved the highest quarterly revenue since the company entered the pet space.

Dog snack sales declined slightly, although the Milk Bone brand continued to grow at a low-single digit rate. Smucker attributed this to the brand’s recent expansion into different formats, such as rawhide alternatives.

“Pet snacks are a critical growth and profit driver for our business. While they account for just over 25% of our sales, pet snacks generate a much greater percentage of segment profit. Through a combination of brand building and innovation, we continue to assert our leadership position in this category,” Smucker mentioned during his presentation at CAGNY.

“The shortfall in the quarter was isolated to premium dog, but there were a number of fantastic positives,” Smucker said.

Part of the company’s strategy to bounce back from these declines is to invest in new marketing campaigns, namely emphasizing Rachael Ray’s connection to the pet food brand; adjusting price points for trial size and super premium products; introducing product innovations in natural and functional dog food in fiscal 2021; and optimizing its pet product packaging.

Behind the scenes, Smucker’s continues the search for a new pet segment leader following David Lemmon’s departure from the company in December 2019.

Overall, The J.M. Smucker Company reported a 2% decline in net sales as it continues to divest in certain areas and double down in others.

Read more about financial performance, corporate strategy, and mergers and acquisitions in the pet food and treat market.